TAIPEI, Aug 9 (Reuters) - Taiwan's cabinet will propose a 16% annual rise in defence spending for 2027 which will for the first time exceed T$1 trillion ($31 billion), the official Central News Agency reported on Sunday, as Taipei bolsters its military.
The move will come as China, which views democratically governed Taiwan as its own territory, has ramped up military and political pressure over the past few years to assert its claims, which Taipei strongly rejects.
But Taiwan also faces calls from Washington to spend more on its own defence, mirroring pressure from the United States on Europe, something President Lai Ching-te has enthusiastically embraced.
The proposed budget of more than T$1.1 trillion, to be unveiled on August 20, includes funding for the coast guard, veterans and special projects, and will - like this year - exceed 3% of gross domestic product, the Central News Agency said.
Detailed figures await the final cabinet meeting, it added.
Taiwan's government has made military modernisation a key policy platform and has repeatedly pledged to spend more on its defences, including developing made-in-Taiwan submarines, given the rising threat from China.
China's military operates almost daily around Taiwan, and holds periodic war games, the last in late December.
China is also rapidly modernising its armed forces, with new aircraft carriers, stealth fighter jets and missiles.
In March, China unveiled a rise of 7% in this year's defence spending, to 1.91 trillion yuan ($283.08 billion).
China refuses to talk to Lai, saying he is a "separatist". He says only Taiwan's people can decide their future.
Taiwan is currently in the middle of its annual Han Kuang military exercises.
Watching drills in the northern city of Taoyuan on Sunday, Lai said every exercise was an accumulation of experience giving the military greater confidence.
"Every bit of solid preparation in peacetime adds another measure of stability and strength for our nation," he said, in comments posted on his Facebook account.
($1 = 32.2360 Taiwan dollars)
($1 = 6.7472 Chinese yuan renminbi)
(Reporting by Ben Blanchard; Editing by Lincoln Feast.)
